When It Comes To The Economy, It's The Boomers, Stupid

Pardon my borrowing a phrase from a Clinton who spends a lot less time in Washington these days, but it seems apropos to the news of late.

While economists and pundits debate back and forth, hither and yon as to a solution for the still anemic economy, and marketers search desperately for ways to increase sales, the answer is staring them all right in the face ... or, in many cases, the mirror.

A little group of 80 million consumers ages 45+.

Herewith, a few reasons why.

Let's start with unemployment.

The percentage of Americans who are unemployed has hovered at around 9.6% for some time now. But what's important to look at is who is unemployed.

According to recent New York Times and Bureau of Labor Statistics numbers, by far the largest group of unemployed is the 15-to-24 cohort at a whopping 16.7% (in July this number soared to a record 48% due to the lack of summer jobs for the younger in this group), followed by the 25 to 44 group at 8.2% and finally, the 45+ contingent at only (easy to say if you're employed, I know) 6.3%.



Now, I've been in the advertising business over 30 years and not once have I ever had a client ask me to target the unemployed consumer. I think this is probably for good reason ... the unemployed don't have any money!

So I'll ask, yet again, why are CMOs obsessively focused on the youth market?

Since you've heard me shout the above question so many times before, let's talk for a minute about déjà vu.

One of the perks of living past 50 is that you have something called experience. And experience tells you that things like good times and bad times and Great Recessions come and go and come and go. We lived through the recessions of '73 and '81 and '90 and, of course, the dot-com bubble burst of 2000. And between those times we saw the economy bounce back and we saw huge boom times.

Boomers know that this recession, too, will pass.

Gen Xers, however, aren't quite so sure. And the Millennials have never seen anything like this before. Maybe that's why a whopping 1 in 8 have boomeranged back home to live with their parents. Or why 25 states have shown a decline in birthrates (remember, the oldest Millennials are nearing 30) since the recession began.

And, by the way, all those younger people who have moved back in with their parents -- parents who pay the rent, the cable, the gas and electric and water, buy the food, pay for health insurance, buy and insure the cars -- in most cases, those parents are boomers, 45+.

Speaking of cars (one of my favorite subjects), I have also said many times that people over 50 buy 56% of new cars. In fact, the average age of new car buyers is on the rise, from 43 in 2007 to 48 in 2009.

Now you might counter that this isn't surprising given the economy; young people can't afford to buy new cars, they buy used cars.

Good try.

According to CNW Research, the used car market for teens has fallen from 7.5 million used vehicles bought in 2004 to 4.2 million in 2009. Teens have gone from 17.4% of the used car market to just 10.9% in just five years.

Why? Of course the recession has a lot to do with those numbers. But expecting them to recover anytime soon may be the stuff of pipe dreams. A recent study by J.D Power & Associates indicates that, thanks to technologies like Facebook, Twitter and smartphones, today's young people are feeling less of a need to physically congregate, which results in less need for transportation.

This from the editor of the website Car Connection in July 2010: "It's the peak of summer-job season. And while in the past savings from teens' summer jobs used to often go towards buying a first used car, today it's more likely to go be used for a smartphone, and young drivers are more likely to share the family car ... or stay out of the driver's seat altogether."

So why would a company like Volvo spend millions of dollars to be the car of choice for a teen heart-throb vampire in "Eclipse"?

I can't for the life of me tell you the answer to that question, but I can tell you the results.

"Eclipse" hit theatres in June of this year; in July, Volvo sales were down 33% over the same month a year earlier (which wasn't a banner year either).

Ford is now in the process of selling Volvo to the Chinese.

And my favorite result of the Volvo youth marketing effort comes from a 19 year old's MySpace page: "Why would a rich vampire drive a Volvo?"

I've said it before, I'll say it again:

Eighty million consumers earning $2.5 trillion annually with 2.5 times the discretionary spending power of any other group, holding 75% of the nation's current wealth and standing to inherit between $14 and $20 trillion over the next 20 years seems to me like a group worth targeting by marketers.

I mean, I'm not an economist ... but I'm not stupid, either.

9 comments about "When It Comes To The Economy, It's The Boomers, Stupid ".
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  1. Drew Dec from CSI, September 20, 2010 at 11:08 a.m.

    The Volvo story is a killer!
    Love your insights.

  2. Paula Lynn from Who Else Unlimited, September 20, 2010 at 11:28 a.m.

    You are surprised there are a lot of stupid people out there? Just because a mortgage company/bank will give you enough money to bury yourself, does it mean you have to take it, no questions asked, to guarantee you will do so? Sheep are great targets for wolves. The sheep dogs know.

  3. Mark Burrell from Tongal, September 20, 2010 at 11:42 a.m.

    Some of this to be true although I believe, without a doubt people are more risk averse and set in their ways (and buying habits) as they age.

  4. Richard Timmons from Third Coast Public Relations, LLC, September 20, 2010 at 11:42 a.m.

    Extremely insightful commentary. Always interesting to see marketers target the young urban audience by default. Truly understanding your core target is vital for business success and in most cases it is in the group with the most discretionary income.....

  5. Deborah Trivitt from Trivitt PR, September 20, 2010 at 11:50 a.m.

    Remember, too, some boomers are 'retired' because they are unemployed. Don't have the numbers, but have heard some are taking early retirement & social security payments because they don't have jobs. Also, their retirement funds were depleted by the recession. Age isn't the only demo- or psycho-graphic to look at. And, a lot of us (yep, I'm a boomer) have all the 'stuff' we need or want.

  6. Arthur Koff from, September 20, 2010 at 12:16 p.m.

    We have found that a number of advertisers are finally beginning to realize that boomers have buying power and more importantly are spending money.

    We are receiving daily inquiries asking for information on how to reach older Americans through while a few years ago we received several inquiries a month.

    Even ad agencies have suddenly begun to recognize the boomer/senior market as opposed to committing all their client's ad dollars to the younger TV viewing public.

    It is interesting that newspapers which have an older demographic do not seem to be enjoying the fruits of this discovery.

  7. Chris Conderino from CC Media and Marketing, September 20, 2010 at 1:31 p.m.

    This isn't just a marketing issue; it's a cultural and attitudinal issue. Rather than increasing in value and esteem, once past the age of 50, Americans are percieved as stale and out-of-sync. Our turn is up ... we stayed too long at the party. Marketers would be better advised to stop trying to influence unnecessary change and concentrate on serving the world around them. Never before has the consumer been so forthcoming. All marketers have to do is observe and respond.

  8. Joanne Rusch from Multi Edge Media, September 20, 2010 at 2:42 p.m.

    Your article is great! (LOVE the "Eclipse" story.)

    To several comments above: Boomers are not unilaterally "set" in their ways!

    True, we may remain beholden to certain pop and cereal brands but we all things better/easier/simpler/cheaper, still floats our boat.

    What you miss is that while we may not be willing to trade in our frosted flakes for Special K bars, the amount of goods and services we consume are solid, and ever expanding into new areas to fit changing lifestyles...just like any other age group.

  9. Becky Williamson, September 21, 2010 at 7:59 p.m.

    I am a fitness coach to Baby Boomers. Brent, you nailed it on the head when you say that this demographic has buying power and that many in this demographic have discretionary income to spend.
    Boomers know they'll most likely live longer than their parents did. The Boomers I coach love to travel, they enjoy various leisure activities and they want to be well and feel energetic.
    Advertisers who sell travel, leisure products, and/or fitness/activity programs would do well to target this demographic. Many of these folks are ready to spend money in their "Golden Years" in order to feel young and vibrant.

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